Restructuring Pakistan Steel Mills: Cabinet proposal shot down

The plan envisaged discharging 3,000 employees immediately.

ISLAMABAD: A government plan to restructure loss-making state enterprises suffered an early setback on Wednesday when opposition by the Pakistan Steel Mills (PSM) management blocked an anticipated cabinet decision to relieve 5,000 of its employees.

At least three officials told The Express Tribune that the idea to trim the steel mill staff was dropped abruptly after the management rejected it. The enterprise has of late been surviving on federal government bailouts of billions of rupees.

The finance ministry had said in an overnight statement that it would seek the cabinet’s approval to a decision of offering a golden-handshake scheme to 3,000 PSM employees. A batch of 2,000 more workers was supposed to be discharged later.

Officials at the ministry said that the proposal could not be submitted before the cabinet because the management of the PSM had expressed reservations about it.

A PSM official said that the government had last year forced the management to regularise the services of about 5,000 employees. “It looks odd to fire workers within a year of confirming their jobs,” he added.

The PSM management, the official explained, had proposed to separate the services and technical cadres to ease financial pressure on the PSM. No explanation was given on how this idea of separating the two cadres would help.

The PSM was the first of eight public sector enterprises (PSEs), accruing huge losses, which the government had this weekend promised to restructure. This step was to be taken to avert a brewing political crisis after the main opposition party pushed the ruling party to implement massive economic and administrative reforms.

The cabinet was also scheduled to discuss the restructuring of the Pakistan Electric Power Company (Pepco). This was deferred as well because the finance ministry, the planning division and the water and power ministry had different plans for it.

Among other developments the cabinet approved the draft of Pakistan Health Research Council (PHRC) Bill 2010. It will allow the council to carry out its mandate and academic-based research pursuits effectively. The council will enjoy the status of an autonomous organisation, with its own board of governors to be headed by the federal minister for health.

The cabinet also gave its approval for the Election Laws (Amendment) Bill 2011. The bill is aimed at ensuring free, fair and transparent elections as well as securing and maintaining the integrity of the electoral-rolls database.

Published in The Express Tribune, January 13^th, 2011.